The EU's executive arm said on Wednesday that Turkey's bloc membership negotiations are stalled due to "further serious backsliding" on human rights, judicial independence and stable economic policy, Presstv Reported.
In its annual report on Turkey’s progress toward membership, the Commission said "Turkey has continued to move further away from the European Union."
Turkey has been trying to accede to the EU since the late 1980s, and formal accession talks eventually started in 2005.
"Negotiations have ... effectively come to a standstill," the Commission added.
The bloc's executive arm accused Ankara of enacting limitations of freedom of speech and freedom to protest, saying that the government had "negatively affected" financial markets.
"Serious backsliding continued in the Turkish economy, leading to deeper concerns over the functioning of the country's market economy."
Relations between Turkey and the EU have been strained for several years, especially after the July 2016 coup attempt against Turkish President Recep Tayyip Erdogan, which Ankara says was masterminded by US-based opposition cleric Fethullah Gulen.
The EU has often criticized the crackdown and alleged attacks on freedom of speech in the wake of the botched putsch, in which tens of thousands of people, including journalists, were arrested. Ankara, in return, has accused Brussels of being inattentive to the security threats faced by Turkey.
Despite the lifting of the state of emergency imposed after the failed coup, the Commission said on Wednesday that many of its "repressive elements" became law.
The Commission also expressed serious concern about the annulment of the result of Istanbul’s mayoral vote won by the opposition.
It said the annulment went "against the very core of a democratic electoral process - that is to ensure that the will of the people prevails."
Turkey’s top election body has set June 23 for Istanbul mayoral elections.
Turkey rejects EU's 'unfair' report
Turkey's government condemned as “unfair” the report, which is set to be approved by EU governments in June.
"It is not possible for us to accept the unfair and disproportionate criticisms in the report," Deputy Foreign Minister Faruk Kaymakci said at a press conference in Ankara.
"There are some invalid remarks in the report about Turkey distancing itself from the EU. Turkey stands firmly in its place," he added.
The Turkish official, however, stressed that his country would carefully note constructive criticism, but expects European allies to back its fight against security threats.